*To help government develop infrastructure
Abuja — Mr Imrane Barry Managing Director Total Nigeria Plc says that removal of Petrol subsidy will help government to redirect its earnings to support infrastructure development for economic growth and development.
Barry made this known when he featured on a roundtable on Downstream and midstream at the Nigeria International Petroleum Summit (NIPS) in Abuja.
He spoke on the topic “The down/midstreams: Paths to the future through holistic and integrated solution.
He said that signing of the Petroleum Industry Bill will help to unbundle the oil and gas industry and encourage development, Private investment and create jobs.
“The Petrol Subsidy Regime costs the country approximately 2.6 billion dollars (~N1 trillion) per year and the country can no longer afford it.
“The removal of the subsidy will allow government direct more of its earnings towards infrastructure and social development,” he said.
He said that since government had declared decade of gas there was need for Investment in Natural Gas.
He added that government needed to continue to push policies that would favour private participation and investment in the gas value chain. Production, storage, and distribution.
“Also, government needs to give incentives for investors in the sector – Tax rebates etc to encourage long term participation.
“In the B2C sector, the government should put in place incentives for customers to switch from white fuels to gas powered machines for road transportation.
“They should continued investment in the nation’s critical infrastructure that aids trade and commerce,’’ he added.
He further called for the Fixing of Apapa ports and other ports in Nigeria, Development of interstate road network, fixing of rail lines for human and cargo transportation
Commenting on impact of COVID-19 pandemic to global oil market, he said that it made the market Volume shrank by 30% and margins became weak(Losses) with aviation sector mostly affected for the following reasons.
He added that the global economy was badly affect generally as No traffic due to airport closure,drop in International prices of Jet Fuel – Platts which , led to a huge loss in aviation business due to contractual agreement with international airlines coupled with large amount of “Old stock” in tank.
“PMS is a regulated product, with the price fixed by the government; resulting in fixed margins.
The devaluation of the Naira from N360 to N380 during the pandemic, coupled with rising inflation in the country further eroded this “fixed margin” for the players in the downstream sector,” he said
He urged government to ensure speedy passage of the PIB to help help the sector play its part effectively